Stocks

Dr. Reddy's surges 5% after USFDA report

Reuters Mumbai | Updated on February 18, 2019 Published on February 18, 2019

Shares of Dr. Reddy's Laboratories Ltd climbed as much as 4.9 per cent to Rs 2,689.65, in their biggest intraday per cent gain since November 11.

The US FDA has closed the Establishment Inspection Report (EIR) for FTO VII, the company's formulations manufacturing facility at Duvvada in south India, the drugmaker said on Saturday.

The stock closed at Rs 2,564.05, up Rs 0.70 () on the NSE, and at Rs 2,570.00, up Rs 13.10 (+0.51%) on the BSE.

EIR classifies the inspection as Voluntary Action Initiated, which Nomura says implies that the inspection observations are successfully addressed and the brokerage expects product approvals in due course.

Nomura says the development, therefore, is in line with expectations and helps address investors’ concerns.

“We think the Duvvada formulation site is important with regard to complex product filings and launches in the medium-term over the next two-three years,” said Nomura.

Nomura maintains a target price of Rs 3,478 and a “buy” rating.

Published on February 18, 2019
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